How to Improve Your Credit Score: 10 Steps That Work

The fastest ways to improve your credit score are to pay every bill on time, lower the share of your credit card limits you're using, fix errors on your credit reports and avoid applying for new credit for a while. Payment history and amounts owed together make up 65% of your FICO Score, so that's where your effort pays off most.

Below you'll see exactly how credit scores are calculated, 10 steps to raise yours (with an example), what you can fix in weeks versus what takes years, and the myths that waste people's time.

What a credit score is and what's a "good" one

A credit score is a three-digit number that estimates how likely you are to repay borrowed money on time. Lenders, landlords and insurers may use it to decide whether to approve you and at what price. The two main scoring brands in the U.S., FICO and VantageScore, both use a range of 300 to 850, and both are calculated from the information in your credit reports at the three national credit bureaus: Equifax, Experian and TransUnion.

You don't have a single credit score. You have many versions (FICO Score 8, FICO Score 9, VantageScore 3.0 and 4.0, plus industry versions for auto loans and credit cards), and each bureau may hold slightly different data. The good news: the same habits raise all of them.

How your FICO Score is calculated

FICO groups the information in your credit report into five categories, each with a different weight:

Notice what's not on the list: your income, your job, your savings, your age or where you live. A high salary doesn't raise your score; paying your bills on time does.

10 steps to improve your credit score

1. Get your free credit reports and check them line by line

You can download your reports from Equifax, Experian and TransUnion for free every week at AnnualCreditReport.com, the official site. Look for accounts you don't recognize, late payments you actually made on time, wrong balances or credit limits, and old debts that should have aged off.

2. Dispute any errors

If something is wrong, file a dispute online with the bureau that shows the error, and include proof such as a bank statement or a letter from the lender. The bureau generally has 30 days to investigate. It also helps to contact the company that reported the information. Removing a wrong late payment or a collection that isn't yours can raise a score quickly.

3. Never miss another payment

Payment history is the biggest factor. Late payments are usually reported once you're 30 days past due, and they can stay on your report for up to seven years, although their impact fades over time. Set up autopay for at least the minimum payment on every card and loan, then pay more manually. If you're about to miss a payment, call the lender before the due date; many offer hardship options.

4. Lower your credit utilization

Credit utilization is how much of your revolving credit limits you're using. It's a big part of the "amounts owed" category, and it's the fastest thing you can change.

Credit utilization = Total credit card balances ÷ Total credit limits

A common rule of thumb is to stay under 30%, and lower is better. Two tricks that help:

• Pay before the statement closing date, not just before the due date. Card issuers usually report the balance on your statement, so paying earlier means a lower balance gets reported.
• Watch each card, not just the total. One maxed-out card can hurt even if your overall utilization is low.

5. Ask for a higher credit limit

A higher limit with the same balance means lower utilization. If you've paid on time for six months or more, ask your card issuer for a credit line increase. Ask first whether they'll do a hard inquiry, and don't treat the extra room as extra money to spend.

6. Keep your oldest accounts open

Length of credit history counts for 15%. Closing an old card you don't use can shorten your average account age over time and, right away, it removes that card's limit from your utilization math. If an old card has no annual fee, keep it open and use it for a small purchase every few months so the issuer doesn't close it.

7. Apply for new credit only when you need it

Each application usually triggers a hard inquiry. Hard inquiries stay on your report for two years, but FICO Scores only count the ones from the last 12 months, and a single inquiry typically has a small effect. When you shop for a mortgage, auto loan or student loan, do your rate shopping within a short window (usually 14 to 45 days, depending on the scoring model) so the inquiries are treated as one. Checking your own score is a soft inquiry and never hurts it.

8. Become an authorized user

If a family member with a long, on-time history and a low balance adds you as an authorized user, that card's history may appear on your report. It's one of the fastest ways to build a thin credit file. Make sure the card is reported to the bureaus and that the main cardholder pays on time, because their mistakes would show up on your report too.

9. Build credit if you have little or none

With no credit history, you may not have a score at all. Two tools are designed for this:

• Secured credit card: you put down a deposit (often a few hundred dollars) that becomes your credit limit. Use it for a small recurring bill and pay it in full every month.
• Credit-builder loan: offered by many credit unions and online lenders. The money is held in an account while you make payments, and you receive it at the end. Your on-time payments are reported to the bureaus.

10. Deal with collections the smart way

Newer scoring models such as FICO Score 9 and VantageScore 3.0 and 4.0 ignore collection accounts that have been paid. Many lenders still use older versions, though, so a paid collection may still count against you with them. Before paying an old collection, ask the agency to confirm the debt in writing, and keep records of every payment.

What you can fix fast, and what takes time

Credit score myths

Your 30-day action plan

• Download all three credit reports at AnnualCreditReport.com.
• Dispute any errors with the bureau, with proof attached.
• Turn on autopay for the minimum payment on every account.
• Calculate your utilization, overall and per card, and set a payoff target under 30%.
• Note each card's statement closing date and pay before it.
• Pause new credit applications for at least six months, unless you really need them.

Frequently asked questions

How fast can I raise my credit score?
If high card balances are the main issue, paying them down can show up within one or two billing cycles. Recovering from late payments or collections takes longer, often months to years, but the impact shrinks as they age.

What's the difference between a credit report and a credit score?
Your credit report is the detailed record of your accounts and payments kept by each bureau. Your credit score is a number calculated from that report. Fix the report and the score follows.

Does paying rent or utilities help my credit?
Usually not by default, because they're typically not reported. Some rent-reporting services and newer scoring models can include them, but on-time loan and card payments are what count most today.

Is 700 a good credit score?
Yes. On the FICO scale, 670–739 is considered good, so 700 qualifies for most loans and cards. Reaching 740 and above usually unlocks better interest rates.

Will a debt consolidation loan help my score?
It can, if it lowers your credit card utilization and you keep the cards paid off afterward. The application adds a hard inquiry, and running the balances back up would leave you worse off.

A budget is what keeps balances from coming back. If you don't have one yet, start with our guide on how to make a budget.

This article is educational and isn't personalized financial advice. Learn more in our free personal finance course, with lessons on credit, debt and investing.